UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of: August 2024

Commission file number: 001-38350

Lithium Americas (Argentina) Corp.

(Translation of Registrant’s name into English)

900 West Hastings Street, Suite 300,

Vancouver, British Columbia,

Canada V6C 1E5

 

(Address of Principal Executive Office)

Indicate by check mark whether the registrant files or will file annual reports under cover:

Form 20-F [ ] Form 40-F [X]


 

 


INCORPORATION BY REFERENCE

Exhibits 99.1, 99.2, and 99.6 to this Form 6-K of Lithium Americas (Argentina) Corp. (the "Company") are hereby incorporated by reference as exhibits to the Registration Statement on Form F-10 (File No. 333- 269649) of the Company, as amended or supplemented.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Lithium Americas (Argentina) Corp.

(Registrant)

 

By:

“Samuel Pigott”

Name:

Samuel Pigott

Title:

President and Chief Executive Officer

 

Dated: August 13, 2024

 


EXHIBIT INDEX

 

Exhibit

 

Description

 

 

 

99.1

 

Condensed Consolidated Interim Financial Statements for the six months ended June 30, 2024

 

 

 

99.2

 

Management’s Discussion and Analysis for the six months ended June 30, 2024

 

 

 

99.3

 

CEO Certification

 

 

 

99.4

 

CFO Certification

 

 

 

99.5

 

News Release dated August 13, 2024

 

 

 

99.6

 

Consent of Ernest Burga

 

 

 

 

 

 

 

 

 

 


 

 

Exhibit 99.1

 

 

 

 

 

 

 

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Unaudited)

(Expressed in thousands of US dollars)

 

June 30,

December 31,

January 1,

Note

2024

2023

2023

Restated *

Restated *

$

$

$

CURRENT ASSETS

Cash and cash equivalents

5

96,196

122,293

194,471

Short-term bank deposits

-

-

157,631

Prepayments to Minera Exar for lithium carbonate purchases

7

-

6,673

-

Receivables from purchasers for lithium carbonate

7

12,074

-

-

Other receivables, prepaids and deposits

4,065

4,609

3,990

112,335

133,575

356,092

NON-CURRENT ASSETS

Associates and other investments

-

-

31,343

Investment in Sal de la Puna Project

6

180,967

181,270

-

Loans to Exar Capital

7

357,859

320,869

223,122

Investment in Cauchari-Olaroz Project

7

33,925

59,581

41,507

Long-term receivable from JEMSE

7,574

7,394

6,813

Property, plant and equipment

8

9,646

9,245

9,026

Exploration and evaluation assets

9

343,788

343,092

348,645

933,759

921,451

660,456

TOTAL ASSETS

1,046,094

1,055,026

1,016,548

CURRENT LIABILITIES

Accounts payable and accrued liabilities

5,055

9,649

16,540

Payable to Minera Exar for lithium carbonate purchases

7

14,666

-

-

Customer advances

7

-

2,322

-

Convertible notes interest and other liabilities

2,608

2,608

3,105

Current liabilities excluding equity-settleable convertible notes

22,329

14,579

19,645

Equity-settleable convertible notes

10

199,443

200,361

204,472

221,772

214,940

224,117

NON-CURRENT LIABILITIES

Deferred income tax liability

18

-

10,659

-

Decommissioning provision

-

-

478

Other liabilities

367

496

7,951

367

11,155

8,429

TOTAL LIABILITIES

222,139

226,095

232,546

SHAREHOLDERS’ EQUITY

Share capital

1,477,515

1,475,930

1,029,485

Contributed surplus

19,126

17,678

30,226

Accumulated other comprehensive loss

(3,487

)

(3,487

)

(3,487

)

Deficit

(669,199

)

(661,190

)

(272,222

)

TOTAL SHAREHOLDERS’ EQUITY

823,955

828,931

784,002

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

1,046,094

1,055,026

1,016,548

 

*The comparative information has been reclassified as a result of the application of amendments to IAS 1 as discussed in Note 3.

 

Approved for issuance on August 13, 2024

 

On behalf of the Board of Directors:

 

“Robert Doyle”

 

“George Ireland”

Director

 

Director

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)

(Unaudited)

(Expressed in thousands of US dollars, except for per share amounts; shares in thousands)

 

Three Months Ended June 30,

Six Months Ended June 30,

Note

2024

2023

2024

2023

$

$

$

$

EXPENSES

Exploration and evaluation expenditures

14

(2,756

)

(6,224

)

(5,841

)

(8,199

)

General and administrative

13

(3,035

)

(3,058

)

(7,085

)

(7,402

)

Equity compensation

11

(1,192

)

(1,081

)

(2,570

)

(1,873

)

Share of loss of Cauchari-Olaroz Project

7

(14,527

)

(1,171

)

(26,514

)

(3,382

)

Share of loss of Arena Minerals

-

(307

)

-

(677

)

Share of loss of Sal de la Puna Project

6

(31

)

(187

)

(303

)

(187

)

(21,541

)

(12,028

)

(42,313

)

(21,720

)

OTHER ITEMS

Transaction costs

(512

)

(1,829

)

(1,258

)

(3,639

)

Gain on financial instruments measured at fair value

10

6,083

14,633

10,826

15,955

Finance costs

15

(6,189

)

(5,622

)

(12,204

)

(10,989

)

Foreign exchange gain

19

1,134

4,033

1,613

5,615

Finance and other income

16

12,449

15,737

24,668

26,579

12,965

26,952

23,645

33,521

(LOSS)/INCOME FROM CONTINUING OPERATIONS BEFORE TAXES

(8,576

)

14,924

(18,668

)

11,801

Tax recovery

18

10,751

-

10,659

-

INCOME/(LOSS) FROM CONTINUING OPERATIONS

2,175

14,924

(8,009

)

11,801

INCOME FROM DISCONTINUED OPERATIONS

4

-

10,885

-

7,609

NET INCOME/(LOSS)

2,175

25,809

(8,009

)

19,410

TOTAL COMPREHENSIVE INCOME/(LOSS)

2,175

25,809

(8,009

)

19,410

BASIC AND DILUTED LOSS PER SHARE FROM CONTINUING OPERATIONS

Income/(loss) per share - basic

0.01

0.09

(0.05

)

0.08

Income/(loss) per share - diluted

0.01

0.09

(0.05

)

0.08

BASIC AND DILUTED LOSS PER SHARE FROM DISCONTINUED OPERATIONS

Income per share - basic

-

0.07

-

0.05

Income per share - diluted

-

0.07

-

0.05

BASIC AND DILUTED LOSS PER SHARE TOTAL

Income/(loss) per share - basic

0.01

0.16

(0.05

)

0.13

Income/(loss) per share - diluted

0.01

0.16

(0.05

)

0.13

Weighted average number of common shares outstanding -

basic total

161,194

157,834

160,981

150,363

Weighted average number of common shares outstanding -

diluted total

166,199

161,822

165,986

154,351

 

 

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)

(Expressed in thousands of US dollars, shares in thousands)

 

Share capital

Number

Amount

Contributed

surplus

Accumulated other comprehensive loss

Deficit

Shareholders’

equity

of shares

$

$

$

$

$

Authorized share capital:

Unlimited common shares without par value

Balance December 31, 2022

135,035

1,029,485

30,226

(3,487

)

(272,222

)

784,002

Shares issued on conversion of RSUs, DSUs and exercise of stock options

1,425

7,174

(7,018

)

-

-

156

Shares issued pursuant to the GM investment

15,002

286,954

-

-

-

286,954

Share issuance costs

-

(15,217

)

-

-

-

(15,217

)

Shares issued pursuant to Arena Minerals acquisition

8,456

163,203

-

-

-

163,203

Equity compensation

-

-

4,152

-

-

4,152

DSUs issued in lieu of directors' fees

-

-

329

-

-

329

RSUs issued in lieu of accrued bonuses

-

-

3,109

-

-

3,109

Net income

-

-

-

-

19,410

19,410

Balance June 30, 2023

159,918

1,471,599

30,798

(3,487

)

(252,812

)

1,246,098

Balance, December 31, 2023

160,679

1,475,930

17,678

(3,487

)

(661,190

)

828,931

Shares issued on conversion of RSUs, DSUs, PSUs, and exercise of stock options

551

1,585

(1,585

)

-

-

-

Equity compensation (Note 11)

-

-

3,033

-

-

3,033

Net loss

-

-

-

-

(8,009

)

(8,009

)

Balance June 30, 2024

161,230

1,477,515

19,126

(3,487

)

(669,199

)

823,955

 

 

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Expressed in thousands of US dollars)

 

Six Months Ended June 30,

Note

2024

2023

$

$

OPERATING ACTIVITIES

(Loss)/income from continuing operations

(8,009

)

11,801

Income from discontinued operations

-

7,609

Consolidated net (loss)/income

(8,009

)

19,410

Items not affecting cash and other items:

Equity compensation

11

3,033

3,333

Depreciation

424

1,033

Deferred tax recovery

18

(10,659

)

-

Foreign exchange gain

(1,613

)

(5,615

)

Share of loss of Cauchari-Olaroz Project

7

26,514

3,382

Share of loss of Arena Minerals

-

677

Share of loss of Sal de la Puna Project

6

303

187

Gain on financial instruments measured at fair value

10

(10,826

)

(15,956

)

Finance costs (net)

(11,570

)

(3,580

)

Payment of interest on the convertible notes and debt facilities

10

(2,264

)

(2,264

)

Changes in non-cash working capital items:

Increase in receivables, prepaids and deposits

(11,198

)

(2,889

)

Increase in accounts payable and accrued liabilities

12,147

7,491

Decrease in net prepayments made for lithium carbonate

4,351

(3,861

)

Cash used in operating activities of continuing operations

(9,367

)

(6,261

)

Cash used in operating activities of discontinued operations

4

-

(24,658

)

Net cash used in operating activities

(9,367

)

(30,919

)

INVESTING ACTIVITIES

Loans to Exar Capital

7

(41,979

)

(62,230

)

Proceeds from repayment of loans by Exar Capital

7

26,476

-

Contribution to Investment in Cauchari-Olaroz project

7

(858

)

(1,159

)

Proceeds from withdrawal of short-term bank deposits

-

100,000

Change in cash as a result of Arena Minerals acquisition

-

(2,592

)

Additions to exploration and evaluation assets

(696

)

(1,023

)

Additions to property, plant and equipment

(825

)

(2,876

)

Cash (used)/provided by investing activities of continuing operations

(17,882

)

30,120

Cash used in investing activities of discontinued operations

4

-

(57,266

)

Net cash used in investing activities

(17,882

)

(27,146

)

FINANCING ACTIVITIES

Proceeds from equity awards exercises

-

156

Lease payments and other

(461

)

(9

)

Cash (used)/provided by financing activities of continuing operations

(461

)

147

Cash provided by financing activities of discontinued operations

 4

-

302,871

Net cash (used)/provided by financing activities

(461

)

303,018

Effect of foreign exchange on cash

1,613

5,615

CHANGE IN CASH AND CASH EQUIVALENTS

(26,097

)

250,568

CASH AND CASH EQUIVALENTS - BEGINNING OF THE PERIOD

122,293

194,471

CASH AND CASH EQUIVALENTS - END OF THE PERIOD

96,196

445,039

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

1. NATURE OF OPERATIONS

Lithium Americas (Argentina) Corp. (“Lithium Argentina”, the “Company” or “LAAC”), formerly Lithium Americas Corp. (“Lithium Americas” or “LAC”), is a Canadian-based resource company focused on advancing the Cauchari-Olaroz project (“Cauchari-Olaroz”) to full production. Cauchari-Olaroz is a lithium brine project located in the Salar de Olaroz and Salar de Cauchari in Jujuy province, north-western Argentina. The Company also owns the Pastos Grandes lithium project (“Pastos Grandes”) acquired through the acquisition of Millennial Lithium Corp. (“Millennial”) on January 25, 2022, and a 65% ownership interest in the Sal de la Puna project (“Sal de la Puna”), owned by the Company’s wholly-owned subsidiary Arena Minerals Inc. (“Arena Minerals”) acquired on April 20, 2023. Pastos Grandes and Sal de la Puna are lithium brine projects located in Salta province, in north-western Argentina.

The Company’s interest in Cauchari-Olaroz is held through a 44.8% ownership interest in Minera Exar S.A. (“Minera Exar”), a company incorporated under the laws of Argentina. Ganfeng Lithium Co. Ltd. (“Ganfeng”) owns 46.7% of Minera Exar with the remaining 8.5% interest held by Jujuy Energia y Mineria Sociedad del Estado (“JEMSE”), a mining investment company owned by the provincial government of Jujuy. Cauchari-Olaroz is in the commissioning and ramp up stage and achieved first lithium production as part of commissioning in June 2023.

 

On March 5, 2024, the Company announced execution of a definitive agreement with a subsidiary of Ganfeng whereby Ganfeng agreed to acquire $70,000 in newly issued shares of Proyecto Pastos Grandes S.A. (“PGCo”) (the “Pastos Grandes Transaction”), the Company’s indirect wholly-owned Argentinian subsidiary holding the Pastos Grandes project in Salta, Argentina, which is expected to represent an approximate 15% interest in PGCo and the Pastos Grandes project. The Pastos Grandes Transaction is subject to applicable regulatory approvals and other closing conditions and is expected to be completed in Q3 2024.

On July 31, 2023, at the annual, general and special meeting of the Company, the Company’s shareholders approved the separation of Lithium Americas into Lithium Americas (Argentina) Corp. and a new Lithium Americas Corp. (“Lithium Americas (NewCo)”), pursuant to a statutory plan of arrangement (the “Separation”). The Separation was completed on October 3, 2023, pursuant to a final order dated August 4, 2023, from the Supreme Court of British Columbia approving the plan of arrangement. As a result of the transaction, on October 3, 2023, the Company transferred its North American business, including, among other assets, the Thacker Pass Project (“Thacker Pass”) and $275,499 of cash to Lithium Americas (NewCo), and the Company changed its name to Lithium Americas (Argentina) Corp. (Note 4).

The Company’s common shares are listed on the Toronto Stock Exchange (“TSX”) and the New York Stock Exchange (“NYSE”) under the symbol “LAAC”. The Company’s head office and principal address is Suite 300, 900 West Hastings Street, Vancouver, British Columbia, Canada, V6C 1E5.

To date, the Company has not generated significant revenues from operations and has relied on equity and other financings to fund operations. The underlying values of exploration and evaluation assets are dependent on the existence of economically recoverable reserves, securing and maintaining title and beneficial interest in the properties, and the ability of the Company to obtain the necessary financing to complete permitting and development, and to attain future profitable operations.

 

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

2. BASIS OF PREPARATION AND PRESENTATION

 

These condensed consolidated interim financial statements of the Company (“Interim Financials”) have been prepared in accordance with IFRS Accounting Standards applicable to the preparation of interim financial statements, under International Accounting Standard 34, Interim Financial Reporting. The Interim Financials should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2023 (the “2023 Annual Financials”), which have been prepared in accordance with IFRS Accounting Standards.

The Interim Financials are expressed in United States dollars (“US$”), the Company’s presentation currency. The same accounting policies and methods of computation have been used in the Interim Financials and 2023 Annual Financials other than those disclosed in Note 3.

 

3. SUMMARY OF MATERIAL ACCOUNTING POLICIES

Estimation Uncertainty and Accounting policy judgments

The preparation of these Interim Financials in conformity with IFRS Accounting Standards applicable to the preparation of interim financial statements requires judgments, estimates, and assumptions that affect the amounts reported. Those estimates and assumptions concerning the future may differ from actual results. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The nature and number of significant estimates and judgments made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty are the same as those that management applied to the 2023 Annual Financials except for certain pronouncements disclosed.

New IFRS Pronouncements

Amendments to IAS 1 – Presentation of Financial Statements

In October 2022, the IASB issued amendments to IAS 1, Presentation of Financial Statements titled Non-current liabilities with covenants. These amendments sought to improve the information that an entity provides when its right to defer settlement of a liability is subject to compliance with covenants within 12 months after the reporting period. These amendments to IAS 1 override but incorporate the previous amendments, Classification of liabilities as current or non-current, issued in January 2020, which clarified that liabilities are classified as either current or non-current, depending on the rights that exist at the end of the reporting period. Liabilities should be classified as non-current if a company has a substantive right to defer settlement for at least 12 months at the end of the reporting period. The Company adopted these amendments effective January 1, 2024, applied them retrospectively as required by the transitional provisions of the amendments and included restated consolidated statements of financial position for the comparative periods ended December 31, 2023, and January 1, 2023.

Amendments to IAS 1 resulted in a reclassification of convertible senior notes (the “Convertible Notes”, “Notes”, or “equity-settleable convertible notes”) from non-current liabilities to current liabilities as at January 1, 2023 and December 31, 2023. The Convertible Notes are convertible at the option of the holders upon satisfaction of certain conditions that are beyond the control of the Company. If such conditions are satisfied, the convertible notes would be convertible at the option of the holders and upon conversion, the Notes may be settled, at the Company’s election, in common shares of the Company, cash or a combination thereof. As a result, the Company does not have the right to defer settlement of the Notes for more than 12 months after the end of the reporting periods (Note 10).

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

3. SUMMARY OF MATERIAL ACCOUNTING POLICIES (continued)

IFRS 18 Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued IFRS 18, Presentation and Disclosure in Financial Statements which will replace IAS 1, Presentation of Financial Statements. IFRS 18 introduces new requirements on presentation within the statement of profit or loss, including specified totals and subtotals. It also requires disclosure of management-defined performance measures and includes new requirements for aggregation and disaggregation of financial information based on the identified ‘roles’ of the primary financial statements and the notes.

In addition, there are consequential amendments to other accounting standards; some requirements previously included in IAS 1 have been moved to IAS 8 and limited amendments have been made to IAS 7 and IAS 34. IFRS 18 is effective for the reporting period beginning on or after January 1, 2027, with early application permitted. Retrospective application is required in both annual and interim financial statements. The Company has not yet applied this standard, and the application of this standard will have an impact on the presentation of the Company’s financial statement.

Amendments to IFRS 9 and IFRS 7 – Amendments to the Classification and Measurement of Financials Instruments

In May 2024, the IASB issued amendments to IFRS 9 and IFRS 7, Amendments to the Classification and Measurement of Financials Instruments. These amendments updated classification and measurement requirements in IFRS 9 Financial Instruments and related disclosure requirements in IFRS 7 Financial Instruments: Disclosures. The IASB clarified the recognition and derecognition date of certain financial assets and liabilities, and amended the requirements related to settling financial liabilities using an electronic payment system. It also clarified how to assess the contractual cash flow characteristics of financial assets in determining whether they meet the solely payments of principal and interest criterion, including financial assets that have environmental, social and corporate governance (ESG)-linked features and other similar contingent features. These amendments require additional disclosure for financial instruments with contingent features that do not relate directly to basic lending risks and costs and amended disclosures relating to equity instruments designated at fair value through other comprehensive income.

The amendments are effective for annual periods beginning on or after January 1, 2026. Early adoption is permitted, with an option to early adopt the amendments for contingent features only. The Company has not yet applied this standard and will assess the effect of these amendments on the Company’s financial statement.

4. DISTRIBUTED OPERATIONS

Upon completion of the Separation on October 3, 2023, the Company transferred its North American business, including, among other assets, its Thacker Pass Project and $275,499 of cash to Lithium Americas (NewCo). Pursuant to the plan of arrangement, each shareholder received one common share of Lithium Argentina and one common share of Lithium Americas (NewCo) in exchange for each common share of the Company previously held. As part of the approval of the Separation, the Company’s shareholders also approved amendments to the equity incentive plan to allow holders of restricted share units, performance share units and deferred share units to receive on Separation one similar instrument in each of Lithium Argentina (subject to adjustment) and Lithium Americas (NewCo). The Company has no further interest in Lithium Americas (NewCo) subsequent to the Separation.

 

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LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

 

4. DISTRIBUTED OPERATIONS (continued)

The distributed operations have been presented and accounted for using IFRS 5, Non-Current Assets Held for Sales and Discontinued Operations, and IFRIC 17, Distribution of Assets to Owners. Under this guidance, a dividend was recognized in deficit measured at the fair value of the net assets distributed with a corresponding dividend payable. The dividend payable was then settled through the distribution of the net assets. The fair value of the net assets distributed was $1,680,501, determined based on the share price of Lithium Americas (Newco) on October 4, 2023. The difference of $1,267,552 between the fair value of the dividend and the carrying value of the net assets was recognized as a gain on distribution of assets within discontinued operations during the year ended December 31, 2023.

The results and cash flows of Lithium Americas (NewCo) presented as discontinued operations are as follows:

 

Three Months Ended

June 30,

Six Months Ended

June 30,

2024

2023

2024

2023

$

$

$

$

EXPENSES

Exploration and evaluation expenditures

-

-

-

(5,626

)

General and administrative

-

(3,744

)

-

(5,358

)

Equity compensation

-

(1,362

)

-

(1,557

)

-

(5,106

)

-

(12,541

)

OTHER ITEMS

Transaction costs

-

(2,802

)

-

(6,830

)

Gain on financial instruments measured at fair value

-

18,713

-

26,959

Finance income/(costs)

-

37

-

(32

)

Other income

-

43

-

53

-

15,991

-

20,150

INCOME FROM DISCONTINUED OPERATIONS

-

10,885

-

7,609

 

 

Six Months Ended June 30,

2024

2023

$

$

Cash used in operating activities of discontinued operations

-

(24,658

)

Cash used in investing activities of discontinued operations

-

(57,266

)

Cash provided by financing activities of discontinued operations

-

302,871

 

 

 

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8

 

 


LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

5. CASH AND CASH EQUIVALENTS

Cash and cash equivalents

 

June 30, 2024

December 31, 2023

$

$

Cash

96,196

42,169

Cash equivalents

-

80,124

96,196

122,293

 

As at June 30, 2024, $355 of cash and cash equivalents was held in Canadian dollars (December 31, 2023 – $2,438), $95,442 in US dollars (December 31, 2023 – $119,569) and $399 were held in Argentine Pesos (December 31, 2023 – $286). During the six months ended June 30, 2024, cash and cash equivalents generated an interest income of $2,183.

 

6. INVESTMENT IN SAL DE LA PUNA

 

On April 20, 2023, the Company completed the acquisition of Arena Minerals that owns 65% of Sal de la Puna through a joint venture interest in Sal de la Puna Holdings Ltd., the 100% owner of Argentine entity, Puna Argentina S.A.U. (“PASA”), the owner of the claims forming part of the Sal del la Puna Project.

 

The remaining 35% of PASA is owned by joint venture partner Ganfeng New Energy Technology Development (Suzhou) Co., Ltd. Therefore, after the acquisition of Arena Minerals, the Company holds a 65% ownership interest in the Sal de la Puna Project covering approximately 13,200 hectares of the Pastos Grandes Basin.

The Company’s 65% ownership interest in Sal de la Puna is considered to be a joint venture and accounted for using the equity method of accounting. Changes in the investment balance are summarized below:

 

$

Investment in Sal de la Puna, as at December 31, 2023

181,270

Share of loss of Sal de la Puna

(303

)

Investment in Sal de la Puna, as at June 30, 2024

180,967

 

 

7. INVESTMENT IN CAUCHARI-OLAROZ PROJECT

As at June 30, 2024, the Company, Ganfeng and JEMSE are 44.8%, 46.7% and 8.5% shareholders, respectively, of Minera Exar, the company that holds all rights, title and interest in and to Cauchari-Olaroz, which is located in the Jujuy province of Argentina. The Company and Ganfeng are parties to a shareholders’ agreement concerning management of the project and are entitled to the project’s production offtake on a 49%/51% basis. Construction costs are also shared on the same 49%/51% pro rata basis between the Company and Ganfeng. The shareholders’ agreement regulates key aspects of governance of the project, which provides the Company with significant influence over Minera Exar and strong minority shareholder protective rights. In addition, the Company and Ganfeng are 49% and 51% shareholders, respectively, in Exar Capital, a company that provides financing to Minera Exar for the purpose of advancing construction of Cauchari-Olaroz (the investment in Minera Exar and investment in Exar Capital together, the “Investment in Cauchari-Olaroz project”). Minera Exar and Exar Capital are accounted for using the equity method of accounting.

 

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9

 

 


LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

7. INVESTMENT IN CAUCHARI-OLAROZ PROJECT (continued)

Loans to Minera Exar and Exar Capital

The Company has entered into loan agreements with Minera Exar and Exar Capital to fund the construction of Cauchari-Olaroz. Changes in the loans’ balances are summarized below.

 

$

Loans to Exar Capital, as at December 31, 2022

223,122

Loans to Exar Capital

64,680

Accrued interest

33,067

Loans to Exar Capital, as at December 31, 2023

320,869

Loans to Exar Capital

41,979

Repayment of loans by Exar Capital

(26,476

)

Accrued interest

21,487

Loans to Exar Capital, as at June 30, 2024

357,859

 

 

Loans advanced after January 1, 2022, carry an interest rate of the Secured Overnight Financing Rate (“SOFR”) plus 10.305%. During the six months ended June 30, 2024, $41,979 loans were provided by the Company to Exar Capital to fund Cauchari-Olaroz’s working capital and other funding requirements. The maturity of each of the loans is 7 years from the date of drawdown.

 

During the six months ended June 30, 2024, Minera Exar repaid or refinanced a portion of the outstanding third party loans that were secured with bank letters of credit arranged by Exar Capital which resulted in release of Exar Capital’s cash collateral. Exar Capital utilized the Company’s share of released cash collateral to repay $26,476 to LAAC as settlement of a portion of loans advanced by LAAC. As at June 30, 2024, loans advanced to Exar Capital by the Company (including accrued interest) of $10,164 are due in 2025, $55,634 are due between 2026 and 2027, $292,061 between 2028 and 2031.

 

During the six months ended June 30, 2024, Minera Exar obtained debt financing in the form of loans totaling $78,000 from banks and third parties to refinance its debt, fund working capital and other requirements and settled approximately $113,000 (a portion of the outstanding third party loans). The accumulated amount of such loans obtained from third parties as of June 30, 2024, is approximately $314,800 and they include loans totaling:

 

$118,000 which are secured with a $19,600 letter of credit and $30,000 guarantee provided by Ganfeng (the Company has in turn provided a guarantee to Ganfeng in the amount of $34,300 for the loans), $43,600 local bank guarantees arranged by Minera Exar, and a $9,500 bank letter of credit arranged by Exar Capital, with the Company and Ganfeng providing cash that is held by Exar Capital as collateral under the letter of credit. This cash can be used to settle Minera Exar loans;

 

$63,000 which are secured with a $63,000 guarantee provided by Ganfeng. The Company has in turn provided a guarantee to Ganfeng in the amount of $30,900 for the loans; and

 

The remaining third-party loans are unsecured.

As at June 30, 2024, third party loans of approximately $275,600 are due on or before June 30, 2025 and $39,200 are due in the second half of 2025.

 

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10

 

 


LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

7. INVESTMENT IN CAUCHARI-OLAROZ PROJECT (continued)

Offtake Agreement with Ganfeng and Bangchak

The Company and Ganfeng are entitled to a share of offtake from production at Cauchari-Olaroz. The Company is entitled to 49% of the offtake, which would amount to approximately 19,600 tonnes per annum (“tpa”) of lithium carbonate assuming full capacity is achieved. The Company has entered into an offtake agreement with each of Ganfeng and Bangchak to sell a fixed amount of offtake production at market-based prices, with Ganfeng entitled to 80% of the first 12,250 tpa of lithium carbonate (9,800 tpa assuming full production capacity) and Bangchak entitled to up to 6,000 tpa of lithium carbonate (assuming full production capacity).

The balance of the Company’s offtake entitlement, amounting to up to approximately 3,800 tpa of lithium carbonate is uncommitted, but for limited residual rights available to Bangchak to the extent production does not meet full capacity.

Prepayment of purchases and sales of lithium carbonate

In Q2 2023, the Company entered into an agreement to receive prepayments from Ganfeng with respect to the Company’s sale of 80% of its 49% share of the future lithium carbonate production from Minera Exar. The agreement provided the Company the right to settle its obligation to Ganfeng through assigning its rights to receive a corresponding value of lithium carbonate from Minera Exar. Concurrently, the Company entered into an agreement to make prepayments to Minera Exar with respect to the Company’s 49% share of the future lithium carbonate production from Minera Exar.

The prepayments to Minera Exar were non-interest bearing (except in the case of default) and were settled as a credit against the purchase of lithium carbonate within 365 days of the prepayment invoice.

As at January 1, 2024, there were $6,673 prepayments that had been made to Minera Exar and $2,322 prepayments received from Ganfeng, which were fully settled in Q1 2024 against the lithium carbonate purchases from Minera Exar and sales to Ganfeng respectively.

Purchases and sales of lithium carbonate

During the six months ended June 30, 2024, the Company purchased 49% of Minera Exar’s lithium carbonate shipped during the period with Ganfeng purchasing the remaining 51% of the product shipped. The Company sold the purchased lithium carbonate to Ganfeng and Bangchak and acted in the capacity of agent in such sales transactions, as the Company’s acquisition of title to lithium carbonate was simultaneous with the sale of lithium carbonate to Ganfeng and Bangchak and the Company was not directly exposed to inventory or price risk related to lithium carbonate.

Since there was no net amount of commission to the Company, there was no impact on the Company’s statement of comprehensive loss for the six months ended June 30, 2024.

As at June 30, 2024, the Company has $14,666 payable to Minera Exar and $12,074 receivable from Ganfeng and Bangchak included in payable to Minera Exar for lithium carbonate purchases and receivables from purchasers of lithium carbonate on the statement of financial position respectively.

 

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11

 

 


LITHIUM AMERICAS (ARGENTINA) CORP. (FORMERLY LITHIUM AMERICAS CORP.)

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024

(Expressed in thousands of US dollars, except for per share amounts; shares and equity instruments in thousands)

 

7. INVESTMENT IN CAUCHARI-OLAROZ PROJECT (continued)

Investment in Cauchari-Olaroz Project

 

Changes in the Investment in Cauchari-Olaroz Project are summarized below:

 

$

Investment in Cauchari-Olaroz Project, as at December 31, 2022

41,507

Contribution to Investment in Cauchari-Olaroz Project

1,863

Share of income of Cauchari-Olaroz Project

53,555

Elimination of the Company’s portion of capitalized intercompany interest

(37,344

)

Investment in Cauchari-Olaroz Project, as at December 31, 2023

59,581

Contribution to Investment in Cauchari-Olaroz Project

858

Share of loss of Cauchari-Olaroz Project

(15,656

)

Elimination of the Company’s portion of capitalized intercompany interest

(10,858

)

Investment in Cauchari-Olaroz Project, as at June 30, 2024

33,925

 

 

As of January 1, 2024, the Company’s investment in Minera Exar was $23,456 and Exar Capital was $36,125 and contributions to the investment in Minera Exar during the six months ended June 30, 2024, were $858. Since the Company’s share of Minera Exar loss for the six months ended June 30, 2024, exceeded the carrying value of the investment in Minera Exar, the Company recognized its share of loss equal to the carrying value of the investment in Minera Exar of $24,314. The recognized and unrecognized share of Minera Exar losses were $24,314 and $52,280 respectively for the six months ended June 30, 2024. The Company’s share of Exar Capital loss was $2,200 for the six months ended June 30, 2024.

 

The following are the amounts presented in the financial statements of Minera Exar on a 100% basis as amended to reflect the Company’s accounting policies.

 

June 30,

2024

December 31, 2023

$

$

Current assets

Cash and cash equivalents